Introduction
Investing can seem overwhelming, but Exchange-Traded Funds (ETFs) make it accessible and efficient. Whether you’re new to investing or looking for a straightforward way to grow your portfolio, ETF investing is worth exploring. Some of the most valuable ETFs, however, come with high price tags. Let’s take a closer look at two prominent examples: VOO and QQQ.
Expensive but Valuable: VOO and QQQ
VOO, which represents the S&P 500, has had an impressive 27% Year-to-Date (YTD) growth so far in 2024. Similarly, QQQ, representing the Nasdaq-100, has achieved a remarkable 32% YTD growth.
At the time of this writing, VOO is priced at $555 per share, and QQQ is $536 per share. For beginner investors, these price points may seem out of reach. So, how can you start ETF investing if you can’t afford to buy full shares of these ETFs?
Fractional Shares: A Game-Changer for Beginners
The good news is that many brokers now allow you to purchase fractional shares. Platforms like Charles Schwab, Fidelity Investments, and Robinhood make it possible to invest in high-priced ETFs with as little as a few dollars. In addition, most of these platforms offer zero fees for trading, making ETF investing more accessible than ever.
A Real-Life Example: My Journey with VOO and QQQ
If you’ve followed my journey with VOO, you’ll know how consistent investing can pay off. Here are some articles I’ve written detailing my experience:
- How to Invest in VOO with Just $50 a Week: A Simple Guide to Growing Your Wealth
- From Sandwiches to Stocks: A Year of Investing $50 a Week in VOO
- Investing in VOO
VOO Performance
I started investing $50 per week in VOO in May 2023. As of now, my portfolio has gained 21.5%. This consistent investment approach has allowed me to participate in the growth of the S&P 500, regardless of the weekly price fluctuations.
QQQ Performance
In July 2024, I began investing $50 per week in QQQ. Despite being newer to this position, my portfolio has already gained 12.27%. Again, the key was consistency, not timing the market.
The Importance of Consistency in ETF Investing
One of the biggest lessons from my journey is that it doesn’t matter if the price of an ETF is high or low on any given week. What matters most is creating a habit of regular investing. Whether it’s $50 per week or $5 per week, the key is to start and stick to your plan.
The Long-Term Benefits of ETF Investing
ETF investing allows you to build wealth through the power of compounding. By staying committed to a long-term strategy, you can grow your portfolio over time. The most important step is to start—and to remain consistent. Your future self will thank you for the habits you establish today.
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